IN THE HIGH COURT OF JUDICATURE AT PATNA
ANIL KUMAR SINHA, J.
Manish Kumar - Appellant
Versus
Urban Development & Housing Department and Others - Respondents
Civil Writ Jurisdiction Case No. 8307 of 2020
Decided On : 22-03-2021
Government Contract – Work Contract – Cancellation – Writ application for direction to respondent authorities to extend time period of contract allotted in favour of petitioner for collection of parking charges – Main ground on which petitioner has filed present writ application is that petitioner could not utilize parking area and could not realize parking charges due to intervening pandemic situation and complete national lockdown imposed in State of Bihar till 31.07.2020 – Lockdown was extended from time to time and as a result of lockdown all institutions and Offices including public and private establishments were closed down and plying of all vehicles was prohibited in Bihar including Patna excluding vehicles belonging to super emergency services – Petitioner did not contemplate at the time of entering into contract that there would be complete nationwide lockdown and all vehicular movement would be stopped and/or restricted – It is due to these circumstances petitioner could not perform obligations imposed upon him for collection of parking charges – It is these circumstances that frustrated performance of contract making it impossible and impracticable for petitioner to operate parking area – Unforeseen circumstances had intervened making it impracticable for petitioner to start collection of parking charges effective from 01.04.2020 and it could safely be said that contract between petitioner and respondent no. 2 became impossible to perform within meaning of Section 56 of Contract Act, 1872 – Impugned order of cancellation quashed and refund of amount ordered. (Paras 3, 5, 17, 18 and 20)
ORDER :
1. Heard Mr. Apurv Harsh, learned counsel for the petitioner, Mr. Anil Kumar, learned counsel appearing for the respondent no. 2 - Executive Officer, Nagar Panchayat, Maner and Mr. Upendra Pratap Singh, learned A.C. to Standing Counsel No. 4.
2. The present writ application has been filed for a direction to the respondent authorities to extend the time period of contract allotted in favour of the petitioner for collection of parking charges within the area of Nagar Panchayat- Maner or in the alternative refund of the entire deposited amount of Rs.17,35,080/- paid by the petitioner as advance / security to the respondent no. 2.
3. The main ground on which the petitioner has filed the present writ application is that the petitioner could not utilize the parking area and could not realize the parking charges due to the intervening pandemic situation and complete national lockdown imposed in the State of Bihar till 31.07.2020.
4. The brief facts giving rise to the present writ application is that the respondent no. 2 - Executive Officer, Nagar Panchayat, Maner came out with a notice dated 27.02.2020 inviting tender for various purposes in the Nagar Panchayat, Maner including collection of parking charges of bus /jeep and Ramghat vehicle parking as described at serial no. 1 of the tender notice dated 27.02.2020 (Annexure - "1" to the writ petition) for the financial year 2020-21. The petitioner was declared the highest bidder in the said tender and deposited an amount of Rs.17,35,080/- on 12th & 13th March, 2020 vide receipts dated 12.03.2020 and 13.03.2020 and also submitted security cheques bearing nos. 000005 and 000007 of the Bank of Baroda, Digha Branch for the balance amount of Rs.17,33,994/-. The period for which the contract was awarded to the petitioner was from 01.04.2020 to 31.03.2021. The respondent no. 2 thereafter issued a letter bearing no. 225 dated 18.03.2020 (Annexure - 3 to writ application) whereby the petitioner was allowed to realize the parking charges from bus, jeep and other vehicles within the area of Nagar Panchayat, Maner starting from the period 01.04.2020 to 31.03.2021. The highest amount quoted by the petitioner is mentioned in the letter of award (i.e. Annexure- 3 to the writ petition) as Rs.34,69,000/-.
5. The further case of the petitioner is that the nation faced severe threat and crisis due to COVID- 19 pandemic in March, 2020 and by way of precaution and in order to prevent the disease from spreading throughout India, the Government of India after due consultation with the States including the State of Bihar enforced complete lockdown throughout India on 24.03.2020. The lockdown was extended from time to time and as a result of lockdown all institutions and Offices including public and private establishments were closed down and plying of all vehicles was prohibited in Bihar including Patna excluding vehicles belonging to super emergency services.
6. In the light of above mentioned development / lockdown coming into effect within six days after issuance of parking allotment letter no. 225 dated 18.03.2020 (Annexure - 3 to the writ application) the parking area was closed down even before the tender period starting from 01.04.2020. The writ petitioner further states that without having regard to such prevailing exigency due to COVID-19 pandemic and usual invoking of force majeure which has been claimed by the State Government and its agencies for various contracts / projects the respondent no. 2 has been pressurizing the petitioner to make payment of the balance bid amount and is holding security cheques deposited by the petitioner of Rs.17,33,994/-. The petitioner made several representations before the respondents and requested for extension of the contract since there has been no operations owing to the lowkdown and also no revenue could be generated but the respondents did not take any decision either for extension of the period of tender or refund of earnest money / deposited (Annexure- P/
Delhi Development Authority v. Kenneth Builders and Developers Private Limited and Others
Contractual obligations are binding despite unforeseen events; performance difficulty does not justify waivers or extensions under contract law.
Point of law: Not only is the writ jurisdiction of this Court invoked in a purely contractual matter, having no colour of public law and the writ remedy is thus not maintainable.
Covid-19 pandemic is a force majeure and the provisions of the Act, 2005 are having overriding effect to the provisions of the Electricity Act, 2003 and GTCS terms and conditions of the agreement for....
The main legal point established in the judgment is that the conclusion of a contract can occur upon the award of work, and non-compliance with tender and contract terms can justify contract terminat....
In case the site is required by the Licensor for its own or public purposes, the Licencee shall have to hand over the vacant possession of the site at once.
Occurrence of commercial difficulty, inconvenience or hardship in performance of the conditions agreed to in the contract can provide no justification to wriggle out of the contractual obligations wh....
The COVID-19 lockdown is recognized as a force majeure event affecting contractual obligations, necessitating equitable treatment for parties under similar circumstances.
A public authority cannot cancel a contract arbitrarily without valid reasons, especially when the contract was executed within the authority's term.
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